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tv   [untitled]    June 16, 2012 10:30pm-11:00pm EDT

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egypt. for day two of the presidential election runoff the claims that neither of the candidates represent the people's revolution the voting. age of the country's parliament was dissolved with. me. feel. it is because of the escalating violence. that a russian military. country.
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the future of. the ballots. are set for a key vote that will decide if the country stays and. more of the world's financial woes in the latest edition of the report. i am ask asure this is the kaiser report first a bit of an editorial you know i was watching c n b c the other day and becky and andrew and joe were talking to chris whalen banking analyst guest on the show about j.p. morgan and jamie diamond it whether or not jamie diamond's transgressions were really
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all that bad considering it was just two billion or ten billion or fifteen billion of them got such a huge balance sheet and why are we making such a big fuss over this never did these so-called journalist oversee n.b.c. mention the fact that they are in fact embedded that's right they're there to defend the interest of the bankers not to challenge the interest of the bankers now this is a report not only are we here to challenge the interest of the bankers but we add another spin and it goes like this jamie diamond is an inveterate loser he's a compulsive gambler holic it's not a question of how much penalty should suffer for the crimes just committed but how do we trade the crimes he's going to commit in the next couple of months we know he's going to commit crimes there's no laws against committing crimes he's got a huge balance sheet to throw out of the bonfire of his criminal mentalities so all we have to do is figure out how to position our portfolio to benefit from jamie's next crimes because they're coming they're coming as night follows day and c n b c
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aids and abets the financial terrorism and that's why the us economy is so bad that's where the global economy is so bad and the people of greece are suffering austerity blowing their brains out because nobody is willing to stand up to the interest of the bankers except us. stacy ever max you might have mentioned as well that not just sing in b.c. but congress itself is there as a platform on which jamie dimon can go and stand and speak in front of the people and say i apologize for our mistakes it was just a few traders that didn't understand risk but it's a good point he goes to congress to testify not to disclose his transgressions but to promote his next crime wave and to bring in congressman to finance his next crime way when he goes in front of congress they're like jamie you missed a lot of money trading on inside information of mark manipulation last month when it got for us this month well congressman i plan to do some asymmetric trading through my london desk and throw the markets of global under the bus and you can
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profit from it in the following way wink wink and i'll be back here to shake my tush a little bit and give you some more money for your re-election campaign because i'm an inveterate liar now max speaking of our investigative journalism we did go to london in order to investigate the crime wave there and you came down with some actual war reporting incident on the front line of these financial wars and where we're on the eurostar and i remember distinctly looking at this little girl who was covered in pox and thinking to myself why did they let that little pox ridden girl on this train that's a health hazard little did i know in a few days i myself would come down with chicken pox that's right i've got chicken pox carefully hidden under layers of make up or maybe not so much well a pox on all their houses because out of london comes this headline max libeler
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traders said to avoid charges and british probe traders being investigated by u.k. regulators for the suspected rigging of global interest rates are on likely to face criminal charges while their firms may suffer record fines people with knowledge of the probe said the fs. say is among regulators looking into whether banks tried to manipulate the london interbank offered rate the benchmark rate for three hundred sixty trillion dollars of securities to hide their true cost of borrowing and whether traders colluded to rig the benchmark to profit from interest rate derivatives they bring the. librorum market it's a multi hundred trillion dollar market it's the base rate that determines all other rates you know going around the world it's like the federal reserve discount rate in that way except it's bigger it affects the whole entire global economy they got caught rigging those markets in a way that is reminiscent from that movie office space directed by mike judge of
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beavis and butt-head fame and of course they suffer a small penalty and again my point is a stating that the question is not how do we apply justice to these inveterate gamble all except liars but where will they strike next so we can make a quick buck again here we see an outright crime that has happened and there deter they're trying to figure out whether or not a crime has been committed as you discuss this with matt now here's what bloomberg article says to file criminal charges in england the regulator would need to show traders successfully manipulated the rates not apparently like if you go and bashed the woman over the head and steal her pocketbook well if the pocketbook turned out to have no money in it well you did successfully rob her did you well the story points to be a rolling stone the heir to hunter s. thompson who took down a president richard nixon he's exposing the financial fraud on wall street and has
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got no traction whatsoever to show you how good they are for killing these criminal activities number two they're in london the epicenter of the global financial fraud again and again whether it's a i g bernie made up and they have global it all goes to london and this is why david cameron says you can't have us correspond our financial regulatory laws with anywhere else in the world because that would cut off all the free money we get by hosting the biggest financial crooks in the world and number three why what definition they can't prove that they successfully manipulated the market other than the fact that they have ironclad proof that they successfully when. related the market this is very medieval this is you know the old test to see if somebody is a witch you know tie rock to run her leg or throw in a link if she drowned since you clearly wasn't a witch if she floats to the surface then she's a witch we have to kill or yeah but that's the obvious here is that there's no they could sink to the bottom they can rise to the top when you throw them in the river and they're still no matter what every answer is they're innocent they're they seem
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to be innocent that's always the answer that's always the answer they're always innocent this is the immaculate crime it comes from the womb of of criminal perfection. well the f.s.a. the federal the financial services authority is there they're saying that this could be a record fine so their previous record fine was in two thousand and ten thirty three million pounds or fifty one million dollars which is imposed on j.p. morgan chase for a failure to segregate client money so ok two thousand and ten j.p. morgan was fined a record fine for failing to segregate customer fine well what happened with m.f. global a year later they failed to segregate customer funds and they claim that they never done it before and they'll never do it again because i'm saying they will do it again because they're compulsive gambler the question is where will they strike and how do we profit from it now let's look over in iceland which we always used as an
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example of how you should actually deal with these bankers iceland court sentences ex buyer savings executives to jail now i don't know if i'm saying the name of that bank correct but it's buyer savings bank former chairman john thorsteinn johnson of the lenders x. c.e.o. ragnor is often good johnson were today found guilty of fraud and sentenced to four and a half years in prison by iceland supreme court the court found that the two former executives had used their positions out buyer to grant an eight hundred million kroner six point two million dollar loan which they then used to buy back their shares that were sinking in. before the collapse happened now in making this decision the supreme court took a cow out of the magnitude of the offenses was significant according to the ruling and good johnson's infraction was committed under the auspices of his mandate as the bank's c e o right he couldn't use the c.e.o. defense that he doesn't know what's going on as a company like damon jamie dimon does all the time he's like well i'm just a c.e.o.
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what do i know where's my bonus yes in fact the supreme court found that he had a higher responsibility what you know you make the big bucks you should have more responsibility it should have why i make a lot of money and so my responsibility is go play golf all day but you know how is icelandic economy doing so they went after the bankers oh they're growing again it's one of the fastest growing economies in the world moody's is raising the ratings on debt and this is the message we've brought to athens recently the party wants to be in control but they refuse to go after the bankers and just of the financial times the leader of the ritz a road as long call him or what are you plans to do we want to bring growth back to the greece the greek economy but again he doesn't mention that they have to go after the predatory bankers first so he is still born he is dead on arrival he is a nonevent well in iceland it is growing so fast that once again for the second time in three months the central bank has actually raised interest rates in order
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to try to keep it from overheating central bank money printing six trillion dollars and counting this is out in the rest of the world where bankers are allowed to roam free with all their crime syndicates many more years of money printing from the world's big four central banks now looks destined to add to the six trillion dollars already created says two thousand and eight and may transform the relationship between the once fiercely independent banks and governments well this was a great about clearing the decks and having a debt jubilee letting market forces take over and interest rates begin to rise savers are rewarded for see. capital is created and capitalism flourishes but we don't have to have been anywhere in the world except iceland yeah and so here they are preparing us now we've already printed six trillion dollars the four major central banks of the world bank of england the u.s. fed the japanese central bank and the european central bank they flooded the money into the markets basically all the banks have taken it covered all their losses and
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paid themselves bonuses and now we're going to have more of this money printing in order to appease and make happy and make whole the bankers in the eurozone but they want to do is they want to create new ways to restrict your ties all the bad debt except doing so on a europe wide basis that's the motivation for this so-called euro bond is to really securitize all the bad loans into a new euro wide bad loan and to defer the day of reckoning one more year or two more years however what's happening on the ground in places like greece is that the austerity is so bad that people are now in open revolt so the actual revolution on the ground is meeting the denial the upper echelons of the banking hierarchy and this is always and always will be the classic conditions for revolution now you mentioned greece before and here is a country that refuses and in fact capitulate to the banks or themselves greeks
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withdraw cash ahead of cliffhanger vote greeks pull their cash out of the banks and stocked up with food at a cliffhanger election on sunday that many fear will ease old in the country being forced out of the euro banker said that up to eight hundred million euros or one billion dollars were leaving major banks daily and retailers said some of the money was being used to buy pasta and canned foods but you know maybe it's not only them the people of greece smartly responding to the e.u. threats to seize to introduce capital controls and limitations on a.t.m. . drawls but it's also a response to the six trillion dollars that they say they're going to print another six trillion by the central banks so they're trying to preserve whatever purchasing power they have whatever cash they possess and they are buying stuff that is going to keep bullets preserve their power quite nicely m k forty seven cents over these
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are the classic hedges against monetary insanity by central planners it's a move your money campaign on a global international transnational scale here the greek people are moving their money out of the banks that are zombie banks anyway everybody recognizes that there is on the banks take your money away from the zombie and put it into a safer place which could be silver gold food forty seven rounds it's a move your money campaign on the global basis and more from a couple states ever thanks so much for being on the kaiser report thank you tell go away much more coming your way so stay right there. in the.
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world with. technology innovation all the developments from around russia we've got the future earth covered. i am max kaiser welcome back to the con is the report time now to go to london and speak with brett scott he's a writer a consultant working in alternative finance and financial activism us. field that is a new field financial activism and brett is one of the leading lights in this field he blogs at suit possum dot blogspot dot com where he promotes new concepts for direct financial activism brad scott welcome to the kaiser report back to the great to be all right brett's got on your site you promote new concepts direct financial activism so first can you give us some examples of direct financial activism it's
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a field as developing the experts i think that the primary as i say there is there's three sort of main areas that i look at the first which is quite controversial there's what i call impact on the policy which is basically going undercover and finance which is something which are sort of did do. which is i don't recommend it for everyone but it basically means you drop your if you can be a campaign you kind of drop your cons of cultural sort of look and you get a suit and you go to finance and you try it out and you get some of inside information i think for most people that's probably not viable. there's lots of other ways you can do stuff like shareholder activism is something which is growing . that's actually trying to use the principles of finance against itself in a way so actually becoming a shareholder and trying to trying to. sort of disrupt a system like that there's a lot of limitations to that. i think the thing i'm most excited about with their
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exponential activism of stuff around actually what i call hybrid radicals getting people to actually buy a pos the system almost becoming entrepreneurs so i guess hybrids between campaigners and entrepreneurs who start to develop say alternative currency is the . alternative banking systems and thereby disrupt the system those are the main the main categories i guess all right now one idea you recently came up with bret is with called the safe deposit box that wiki leaks for finance tells about it i guess what i realized was. over the years i've actually made a few points the whistleblowers one of the biggest problems they face is actually sort of the internal internal cultures in finance where you're kind of you're not encouraged to disclose and. if you do you sort of socially shunned there's still a lot of sort of fraudulent issues in finance a lot of sort of excessive risk taking lots of issues with abuse of clients but a lot of that doesn't get occasionally you have a you know sort of a rogue traders revealed but in reality that's what's the tip of the iceberg so i
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thought there's a there's an obvious need for a financial weekly sat and unfortunately wiki leaks itself probably isn't in the best position to do it because a lot of the nation that comes out of finance sector is quite complicated you need something to process that and presented to the public in a. sort of coherent way so i thought my initial impulse was around and we need a specialist that's there but there's a sort of secondary sort of reason i think you want to financial wiki leaks that is a lot of the problems in the financial sector aren't necessarily about criminality per se a lot of them for example a lot of individuals doing individually legal actions which end up creating a toxic overall outcome. we can only bridge basically deals with things that are virtually fraudulent so i think we need a site which also gathers information which is perhaps less controversial but it's very useful so let me give you a concrete example that i've been working on issues around commodity speculation it
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is not illegal to engage in commodity speculation and yet there's a lot of evidence to suggest that for example in agricultural commodities that could really destabilize food prices so i would like to have a site where people instead of back offices of banks can actually country the information on that on that problem and actually thereby help to assist researchers and campaigners and actually contribute to solving that issue yes well now we know in the wiki leaks story that they were exposing some gross transgressions by the military which seemed to go by the by but when the rumor came out that they were about to expose bank of america julian assad just quickly found himself under house arrest so when you start to expose the bankers the risk level for the whistleblower goes up do you think that again even to get the wiki leaks as an example so perhaps a safe deposit box can look go to school on that and come up with a better system you're it where you think there's lots of issues with the wiki
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leaks model i mean one of them being the fact that it's sort of very centralized in the sense that it's all sort of based around the character of your innocence actually i think what a more robust model would be probably could do it maybe it's more what open leaks is doing which is decentralized you get a sense so the people who process the information perhaps the whole set a whole sort of network of individuals actually i think the best people to run it would be whistleblowers themselves because they understand the process they understand the culture the problems that somebody has which i'm not sure that the presumption assigns would necessarily understand you know i think what he's done is great but i think the financial sector has a lot of cultural issues need to be aware of. so yeah there's a there's also other potential issues of how you deal with. sort of quality control of the information that comes out how do you know people are going to try to engage in corporate espionage or sort of sabotage each other via these sites so the i want to put the concept out there to sort of people thought about it and kind of perhaps
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develop something more robust and give people some ideas but i don't think it's yet it's worked out quite how it works you know you start something a minute ago of course that's interesting that they in the act of financial criminality the individuals some of the individual tasks are individual actions i'm sol vhs are technically legal but in aggregate they end up becoming a gross violation and i've often argued myself that there should be some statutes that characterize the difference between consensual and nonconsensual financial violation so that someone who is a victim of non consensual financial violation can go to court and make that case but one thing this the state has pushed in the u.k. is the so-called shareholder spring that somehow shareholders would speak out with their own non-binding votes about spiraling c.e.o. wages that hasn't exactly worked has it yeah well i kind of think one of the
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biggest problems with choying to encourage institutional shareholders to act is that basically socially very conservative they they hang out at the same cocktail parties at the see do and they don't actually want to have the barest in conversations with them when that when they there i think i'm a lot more excited about what you can do it's a hedge funds who are not bound by the same rules and i think you're so sort of toyed with the idea of karma bank and these sort of trying to get hedge funds to act can i think hedge funds a lot freer to act against companies yeah i want to ask you about that because last year the group anonymous declared that they were advising the heads fund of possibly creating a hedge fund that would. act as a countervailing force against financial fraud by mobilizing the hedge fund community to attack companies that were transgressing course they would have their own profit motives but in the free market system all would come out in the
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wash it would still have another words justice would be the result of having a free more freely competitive system where a hedge fund with the interests of anonymous would be represented along with a hedge fund let's say with the interests of george soros so these two could battle it out in the free market and the result would be prices that would more generally unfairly reflect the interests of society at large so now the problem that i had with that concept is that the hedge funds of course loved the idea but activists like greenpeace they were against the idea because any association with anything having to do finance whatsoever they found would be completely alienating to their base of the five and ten dollar supporters is that kind of what you found or how have things changed yeah i mean i think good general that's that's true there are lots of issues with these sort of faustine bargains you might say if you enter into kind of relationships with headphones existing headphones. i think there's
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basically perhaps there's two different proposals i think the groups which have. sort of campaigning groups which which not publicly but certainly in private conversations have advocated the idea of setting up their own hedge funds. and trying to raise enough money for those to sort of fight for certain causes because in reality you're needed to be large enough to actually have any impact on the market. and it's the sort of second area would be trying to harness the existing hedge fund community. by sort of leaking information to them providing them from ation with what about a certain company and then getting them to short that company. in order to suffer again. obvious problem you have with this is you know one you you perhaps alienates your fund raising base if you're an engineer but also you perhaps
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run into big problems with the regulators in the sense that you could be going into the territory of market manipulation so i don't think that area has been quite worked out yet. on the other hand i do think hedge funds all a lot more prepared to listen to external views than the average big institutional investor is so there's something to be had there i don't quite know what it is yet well yeah brett as a former series seven licensed stockbroker myself i can assure you that leaking information asymmetrically as it were would qualify as a violation of the securities acts but i still think that there is room for mobile as mobilizing activists to work with a hedge fund and the idea i came up what would be to boycott to a short position boycott coca-cola for example around the world tie that to a short position that way are not leaking any information just monetizing dissent
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risk but let's move on what about financial activism on a national and transnational scale in ireland we see a nation attacked with the debts of anglo irish debt how do you they organize to fight back against this financial behave with the national scale i mean think of as it was a campaign which i've sort of been. evolved with recently called move your money u.k. . which is modeled in a similar campaign in the states and that was offering the basic premise of those very simple which is trying to get the average person to move their money into a more ethical bank. or more banks a longer term focus or that lends to more you sort of socially useful. things. and i think that in reality the average person who's got the day job doesn't have time to do much activism and that's perfectly understandable but what they do have the
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time to. force their dissent by moving their cash to a different bank which i think is going to serve their interests more fully so the movie money campaign i think it's a great one that's going to be here to stay and so. and there's been a lot of support for that so i think at a national level you those type of campaigns are really great because also there's a form of direct activism that you're not you know speaking to your to your local. politician you actually taking your own money and you're moving it in so doing you're actually making a direct contribution sort of it's a very visceral direct thing people can do all right brett scott i wanted to talk to you about your idea for monarchy back securities as well but rather times i have to say good bye thanks so much for being on the kaiser report thanks michael great ok and that's going to do it for this edition of the kaiser report with me max kaiser and stacy herbert our thank my guest bret scott if you want to send me an e-mail please do so at kaiser reported r t t v are you guys are saying.
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